CAC 40: Firm price levels, decreasing volumes

(News Bulletin 247) – Volatility remains just as intense on the equity markets on both sides of the Atlantic, Paris being no exception. Yesterday, the barometer of the tricolor stock market, the CAC 40 gained 1.24% to 7 051 points, in volumes however in sharp decline. Values ​​linked to aeronautics carried the index, like the engine manufacturer Safran (+ 2.97% to 104.56 euros) or the manufacturer Airbus (+ 4.01% to 111.08 euros). Growth files were also well oriented, such as LVMH (+ 1.98% to 715.40 euros), Dassault Systèmes (+ 2.37% to 52.66 euros), or Cap Gemini (+ 3.62% to 211.60 euros). The absence of many operators as Christmas approaches is starting to be felt on the level of participation. Remember that the Paris Bourse will close early on Friday (2:00 p.m.).

Questions from the market remain intense on the health issue. if the first announcements on this subject were rather reassuring, the exceptional contagiousness of the new strain of the coronavirus still forces several European countries to impose new restrictions, and lowers the morale of operators. “The lockdown announced in the Netherlands will heighten fears that similar measures will be adopted in other European countries in the coming weeks,” writes Lee Hardman, analyst at Mitsubishi UFJ Financial Group. Uncertainty now hangs over what other European countries very affected by Omicron could decide, including the United Kingdom and Italy. Denmark also announced new restrictions last week, in the form of tightened standards in restaurants and cafes.

In terms of statistics, the program finally became denser yesterday, especially on the American side. the final GDP data for Q3 were raised to + 2.3% quarterly, against a previous estimate of + 2.1%. It is above all thanks to household spending, which has been revised sharply upwards, that wealth creation has exceeded expectations. Another important publication that has allowed Wall Street to regain altitude: the consumer confidence index (Conference Board) came out in surprise at 115.8.

On the other side of the Atlantic, the main equity indices gained height on Wednesday, like the Dow Jones (+ 0.74% to 35,753 points) or the Nasdaq Composite (+ 1.18% at 15,521 points). The S&P 500, the benchmark barometer of risk appetite in the eyes of fund managers, gained 1.02% to 4,696 points.

An update on other risky asset classes: around 8 a.m. this morning on the foreign exchange market, the single currency was trading at a level close to $ 1.1270. A barrel of WTI, one of the barometers of risk appetite in financial markets, was trading around $ 71.20.

To be kept on the agenda this Thursday, to follow as a priority an important meeting on US inflation with PCE prices (personal consumption expenditures), a flagship measure for the Fed in the construction of its monetary strategy. The figure will be released at 2:30 p.m., along with durable goods orders and household spending and income. To be followed at 4:00 p.m. new home sales and the UMich index in revised data, the household confidence index.

KEY GRAPHIC ELEMENTS

We did not come out of a volatile broadband phase. The resumption of an unconditional buyer’s rally has not been on the agenda since November 19. A continuation of broadband nervous oscillations should be considered. Band whose amplitude is now defined, between 6,650 and 7,185 points. Between these two bands, nervous and choppy oscillations are therefore still to be expected. The form that consolidation will take will be instructive. Only a clear overshoot under satisfactory volume conditions of 7,185 points would definitely revive the option of a bullish extension.

PREVISION

In view of the key graphic factors that we have identified, our opinion is neutral on the CAC 40 index in the short term.

We will take care to note that crossing 7185.00 points would rekindle the purchase tension. While a break of 6656.00 points would revive the selling pressure.

Hourly data graph

Daily data graph

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